Iowa State University
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News Service

News Service:

Annette Hacker, director,
(515) 294-3720

Office: (515) 294-4777

09-27-07

Contacts:

Mike Ferlazzo, News Service, (515) 294-8986, ferlazzo@iastate.edu

NEWS TIPS: ISU experts can respond to Oct. 26 closing of former Maytag plant in Newton

AMES, Iowa -- Whirlpool Corp. announced last May that it would close the former Newton, Iowa-based Maytag Corp. plant on Oct. 26. While a small appliance parts manufacturing center employing approximately 20 workers will remain open in Newton, Whirlpool is closing the main washer and dryer plant, which employed approximately 1,800 workers.

Iowa State University experts have been working with Newton officials since that plant closing announcement and can provide insight into the community's future. An ISU sociologist has also conducted a study on economic shocks and how they affect Iowa communities, like Newton.

PREPARING FOR NEWTON MINUS MAYTAG -- In an effort to prepare Newton for the economic fallout without Maytag/Whirlpool, ISU economists Liesl Eathington and Dave Swenson -- the project staff of the Office of Social and Economic Trend Analysis (SETA) -- have been working with staff from the Center for Industrial Research and Service (CIRAS) on economic assessments of the region. They prepared a report "Understanding the Greater Jasper County Labor Region, and its Workforce and Industrial Characteristics." It was presented in July to assist citizens, community leaders and planners in Newton and Jasper County to understand regional relationships that can and will affect their future growth prospects. It also displays several important industrial and earnings characteristics of Jasper County and the surrounding area. Among its findings, the region's earning average without the Maytag plant will collapse from 75 percent in 2005 -- meaning the average worker made 75 cents per every dollar that an average U.S. worker makes -- to 64 percent after the closing. "Newton is going to take a punch, but not as much as places in Southeast Iowa that are really suffering economically," said Swenson. "Maytag products were marketed as being steady and dependable, but in the end, Newton couldn't depend on Maytag," he said. Maytag has been a part of Newton's history since 1893, first producing washing machines there in 1907. CONTACT: Liesl Eathington, (515) 294-2954, leathing@iastate.edu;Dave Swenson, (515) 294-7458, dswenson@iastate.edu. Contact News Service for a copy of the report.

ON THE GROUND IN NEWTON -- Mark Reinig, the economic development program manager for Iowa State's College of Engineering, has been coordinating ISU Extension efforts to provide assistance to Newton since the Maytag plant closing was announced. Reinig serves on the Newton Transformation Council and reports that personnel from ISU Extension's Community and Economic Development and Center for Industrial Research and Service (CIRAS) have joined with others from the university to assist Newton in exploring new economic development opportunities. Their assistance helped to secure the nation's first Regional Innovation Grant from the U.S. Department of Labor. The community will conduct a kickoff event to celebrate that $250,000 grant next Monday, Oct. 1. "The Newton Transformation Council has been working for the last year and a half to try and get past the event of the plant closing on Oct. 26," said Reinig. "We've been looking well past that to the economic needs of Newton for the future." CONTACT: Mark Reinig, College of Engineering, (515) 294-7883, mreinig@iastate.edu; Tim Borich, director, Extension Community and Economic Development, associate professor, community and regional planning, (515) 294-8707, borich@iastate.edu; Alan Keninger, Jasper County Extension Director, (641) 792-6433, aken@iastate.edu.

LEARNING FROM PAST ECONOMIC SHOCKS IN IOWA -- ISU Professor of Sociology Terry Besser has been conducting research on past economic shocks in 99 small towns in Iowa. While her sample didn't include Newton, she can relate its plight to her study, which first collected data in 1994 and followed up in 2004. She has already written papers that describe the nature of the shocks and how they impacted the social capital of the community. One of them, titled "Economic Shocks and the Quality of Life in Iowa Small Towns" is available at http://www.soc.iastate.edu/extension/Publications/SRB2005-5.pdf. Besser is currently working on two additional papers. One is about how economic shocks affect residents' emotional attachment to their community and the second compares how different kinds of shocks affect the local economic well being of the community. CONTACT: Terry Besser, (515) 294-0592, tbesser@iastate.edu.

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Quick look

Iowa State experts have been working with Newton officials since in was announced the former Maytag plant would be closing on Oct. 26. They can provide insight into the community's economic future after the closing. An ISU sociologist has also conducted a study on economic shocks and how they affect Iowa communities, like Newton.

Quote

"Newton is going to take a punch, but not as much as places in Southeast Iowa that are really suffering economically."

Dave Swenson